Posted Oct 7, 2022, 5:46 AMUpdated on Oct 7, 2022 at 7:07 am
The Delaware court judge has ruled: the trial between Elon Musk and Twitter will ultimately not take place on October 17. The billionaire and the social network have, very precisely, until October 28 at 5 p.m. to find an agreement. If they are unsuccessful, she will set a new date for the trial in November.
The tone rose between Elon Musk and Twitter before this decision, overnight from Thursday to Friday. The billionaire’s lawyers sent a letter to the Chancery (the Delaware court) complaining about Twitter’s lack of response.
Earlier this week, Elon Musk said he was finally ready to close the deal with Twitter, at the initial price of $54.20 per share. But the social network, suspicious, refused to cancel the lawsuit, as long as the boss of Tesla and SpaceX did not provide proof of his sincerity.
“Twitter refuses to accept our outstretched hand,” Elon Musk’s lawyers fumed in the letter published Thursday. “Unbelievably, they insisted on continuing with the legal process. They blame Twitter for wasting their time by insisting that the trial take place, despite the billionaire’s assurances.
Twitter, for its part, refused to be moved. “The problem is that the defense [Elon Musk, NDLR] still refuses to accept its contractual obligations, ”write the lawyers of the social network. They go so far as to imitate the billionaire, summing up his message thus: “Trust us. This time it’s serious. »
But Elon Musk’s lawyers “provided no reason to say the deal can’t happen” until October 17, when the trial was supposed to start. Twitter therefore saw no reason to delay the trial.
To justify their distrust, they further cite a representative of a bank belonging to the consortium which was to lend money to the billionaire to carry out the transaction. According to a deposition by the latter, the boss of Tesla and SpaceX has not yet contacted his creditors to restart the loan.
Why October 28?
In her decision, the judge refers to the letter from the Elon Musk clan. “The most likely eventuality, by far, is that the loan takes place, in which case the agreement can be completed around October 28,” wrote the billionaire’s lawyers. The judge takes them at their word, and seems to challenge them to keep their word.
According to information from Bloomberg, it was a few words from the letter sent by Elon Musk earlier this week that exacerbated the mistrust of the social network and its lawyers. The boss of Tesla has pledged to complete the transaction – as soon as he receives payments from the banks which have agreed to lend him 13 billion. But such a funding clause did not exist in the initial agreement.
A consortium of banks, led by Morgan Stanley, Bank of America and Barclays, and which also includes BNP Paribas and Société Générale, has agreed to lend Elon Musk $ 12.5 billion for the takeover of Twitter. They expose themselves to heavy losses, because it will probably be difficult for them to resell this debt on the bond market. The rest of the financing will come mainly from the sale of Tesla shares.